Institutional failure isn't caused by bad rules, but by the time it takes to get caught.
April 16, 2026
Original Paper
Beyond Nash: Drift, Load and the Impossibility of Institutional Equilibrium – a Structural Explanation for Governance Drift in Systems With Adaptive Actors
SSRN · 6427759
The Takeaway
Proposing 'Miller's Law of Structural Drift,' this paper argues that people don't optimize for the written rules, but for the 'feedback latency'—how long they can get away with breaking them before anyone notices. Over time, everyone pushes the limits just enough, which eventually pushes the whole system past the point of recovery. It’s why big companies and governments eventually stop working: it’s a structural inevitability in any system where there's a gap between action and consequence. This means that the only way to save an institution isn't to write more rules, but to make the 'catch' happen faster.
From the abstract
Many institutional failures occur in systems that appear robust on paper. <br> <br> <div> Organisations often possess formal rules, oversight bodies, and compliance structures designed to constrain harmful behaviour, yet outcomes repeatedly diverge from those intended by the rule set. This paper proposes a structural explanation: actors optimise within the effective constraint field, not within the declared governance structure. <br> <br> The effective constraint field is defined by enforcement